The Government keeps 188,000 tons of oil under lock and key due to the surplus: relief among olive growers and fear that the price of the bottle will rise

Just two and a half years ago, when the drought turned olive oil into a luxury good, few could imagine that today there would be so much left over that the Government would be forced to order, for the first time, the withdrawal of 12% of production, some 188,000 tons, to avoid a collapse in prices. The order, published yesterday in the BOE, forces the oil mills to immobilize that oil until September 30 of next year, which has divided the sector in two: the field, which had been demanding it for a decade, receives it with relief, and the bottling industry has already announced that it will go to court.

Paco Elvira, 46 years old, cultivates 93 hectares in Fuente del Rey (Jaén), a province where 80,000 farmers make their living from olive trees. «This measure has been fought for a lot because we are convinced that it will provide the stability that the sector desperately needs. It benefits both consumers and producers,” he says. "Saving part of the oil when the harvest is abundant to have it available in short campaigns will avoid things as crazy as the price increase in supermarkets above nine euros or that olive growers have to work below production costs," adds Elvira, also responsible for the olive grove at COAG.

According to the Spanish Association of Olive Municipalities (AEMO), the profitability threshold today is around five euros per kilo, compared to three in 2010. For this reason, Elvira warns, "withdrawing product from the market prevents sales at a loss and protects the survival of thousands of families in the rural world." Jesús Cózar, general secretary of UPA Andalusia, agrees that "the traditional olive grove is not working out": the oil is paid for about three euros per kilo, and the withdrawal, he clarifies, "is not the complete solution." Even so, the field calls it “historical” because it had never been applied before.

José Ugarrio, from Asaja, trusts that it will serve to "try to reactivate the markets and make prices higher," because "prices in some types of olive groves are below production costs."

That peak, in March and April 2024, was the maximum in the INE series. Today the bottle barely exceeds four (between 4.05 and 4.45), and this campaign there is plenty of oil: the Ministry foresees a harvest of 1,602,596 tons, 23% more than the previous one. Added to the 357,040 tons that had already been stored, the figure exceeds 120% of the average of the last six campaigns, the threshold set by the rule to activate the withdrawal. Each oil mill will store 12% of what it produces in its own or third-party warehouses, and the standard does not provide for any compensation for the cost of storage. Agriculture will review the percentage starting December 31.

«It comes to alter the law of supply and demand, and we believe that is not the way. That's why we are going to resort to it," Primitivo Fernández, director of the Anierac packaging association, tells EL MUNDO. For him, this is a "temporary" measure that also leaves Spanish oil at a disadvantage, because "no other country is applying measures at this time." And he warns: if the withdrawal manages to raise prices, the effect "will probably finally be passed on to the consumer."